The destructive offshore world: what to do about its expansion?

A new financial structure, a global tax authority, and the UN system reform are some of the critical challenges to address in light of the expansion of the offshore world. To offset the prevailing tendencies, new and urgent responses to varied questions must be provided, among others: regarding the common good, ecological and population challenges, the extension of sectarian (either state or parastatal) violence, chaotic migrations of the desperation, outbreaks rooted in growing inequality as well as the universal crisis of political systems.

To tackle the expansion of the destructive offshore world, it is necessary to consider some critical aspects, among which the following stand out:

  • The pending crucial discussion on the new financial structure and the needed implementation measures, which must include the global banking industry, “fiscal havens”, financing and rules of conduct of non-financial multinational enterprises and the essential restructuring mechanisms for sovereign debts among their main chapters.
  • The creation, at the level of United Nations, of a global fiscal authority with the purpose of promoting tax harmonization, developing global methods for controlling fiscal compliance, and promoting the effective—and not just as “a matter of speech,” as is the case today—collaboration among tax and customs’ administrations of different nations and regions.
  • Taxes with global scope and triple purpose should also be adopted: fighting the rampant increase of socioeconomic inequality in income and wealth; dealing with forced migrations; and mitigating the great resulting damages of climate change and biosphere deterioration, while financing the necessary actions to protect their victims.
  • The important and complex problem of the necessary reform of the UN system, to secure an effective democratization (an extremely difficult and essential political objective in such an asymmetrical world, overwhelmed by a nationalist resurgence and with multiple power centers) and the redesign of their economic institutions (impossible tasks if dominant economic dogmas of today are not being questioned).

However …

The world is heading in an opposite direction to which we have just mentioned as desirable for enabling non-traumatic changes on a global scale. There is movement towards the “nationalistic-xenophobic” recklessness, the rupture of blocks of countries, and the own disintegration of many nation-States—Brexit, election of Trump in the US, possible division of the United Kingdom, Ukraine war, disintegration of Iraq / Syria states, among various similar processes. Meanwhile, pressing global problems (inequality and environmental crisis are among the main ones) demand the construction of consensuses, the coordination of policies and pave the way for new global powers. That is, agreements where States must necessarily relinquish part of their sovereignty in favor of building the global “common good.” The “nationalistic-xenophobic” tendencies that gain space operate in the opposite direction encouraging the expansion and exacerbation of the “global war” denounced by Pope Francis in front of a public opinion dominated by passivity.

 … maybe there is still margin for thought and action

 In my opinion, essential questions, about which we should reflect on in the context of a systemic approach, are the following (the presentation order does not imply more or less relevance):

  1. Values. In the Gospel according to Saint Matthew we can read. “For where your treasure is, there your heart will be also (6:21)” Will it be that 2,000 years of Western history have taken the global rich to understand the biblical phrase as if by “there” it should be understood fiscal havens where they protect their “fortune,” with their “heart” disengaged from the fate of their fellow countrymen?
  2. Dominant culture devoted to individualistic consumerism.
  3. History, in the West, with a heavy three-and-a-half-century inertia since the Treaty of Westphalia (1648) that tended to make the weight of state sovereignties “absolute” up to the point of allowing the unrestrictive development of fiscal havens while hindering initiatives orientated towards protecting the planetary common good (particularly caring for the environment and the achievement of socioeconomic equality that require being addressed globally).
  4. Competing social and economic forces (national / regional / global).
  5. Existent and necessary institutions (also at national / regional / global levels).
  6. Politics and its global crisis
  7. Human rights
  8. Mass media
  9. Preservation of Mother Earth (which implies, varied knowledge and questions: theological; regarding peace and equality; plural respect of ideas, religions, civilizations, ethnicities; hard sciences and many others).
  10. Methods of analysis needed for addressing and integrating all these questions.

 A final reflection

The “Global State” about which former Uruguayan president José “Pepe” Mujica, among others, talk seems the strategic desideratum (what is desirable), but: how to address its construction?

  • From a “restoration” of the United Nations System, with the necessary and very tough reforms and completion?
  • From an eventual dynamic of multipolar reconstruction, after a long period of global deterioration and disintegration?
  • Which other perspectives could be adopted?

There is no extra time left for humanity to try some alternative route for transformation: ecological and population challenges, the extension of sectarian (state or parastatal) violence, chaotic migrations of the desperation, outbursts with roots in the growing inequality and the universal crisis of political systems that demand new and urgent responses.

 

 References:

Gaggero, Jorge ; “Tributos, fuga de capitales y globalización”, Revista “Nueva Sociedad”, Buenos Aires, Setiembre de 2006.

Morin, Francois: “L´Hydre Mondiale. L´oligopole bancaire”; LUX; Montréal; Avril 2015.

Rua, Magdalena; “Fuga de capitales IX. El rol de los bancos internacionales y el caso HSBC”; Fundación SES / Red de Justicia Fiscal de América Latina y el Caribe / Coalición por la Transparencia Financiera (FTC); Buenos Aires; Diciembre de 2016.

R Palan; “Tax Havens and the Commercialization of State Sovereignty”; International Organization, 56, 1, winter 2002

 

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